China faces surging protests and riots in 2009 as rising unemployment stokes discontent, a state-run magazine said in a blunt warning of the hazards to Communist Party control from a sharp economic downturn.

The unusually stark report in this week’s Outlook (Liaowang) Magazine, issued by the official Xinhua news agency, said faltering growth could spark anger among millions of migrant workers and university graduates left jobless.

“Without doubt, now we’re entering a peak period for mass incidents,” a senior Xinhua reporter, Huang Huo, told the magazine, using the official euphemism for riots and protests.

“In 2009, Chinese society may face even more conflicts and clashes that will test even more the governing abilities of all levels of the Party and government.”

President Hu Jintao has vowed to make China a “harmonious society,” but his promise is being tested by rising tension over shrinking jobs and incomes, as well as long-standing anger over corruption and land seizures.

China also faces a year of politically tense anniversaries, especially the 20th year since the June 1989 crackdown on pro-democracy protesters in Tiananmen Square. That date has already galvanised the “Charter 08″ campaign by dissidents and advocates demanding deep democratic reforms.

While foreign commentary about risks to China’s recipe of fast economic growth and one-party control are common, the nation’s leaders are usually reticent about such threats.

This report and other recent open warnings may be intended to help snap officials to attention, said one Chinese expert.

“The candor about these problems reflects the severity of the unemployment problem. It’s meant to attract the attention of all levels of government,” said Mao Shoulong, a professor of public policy at Renmin University in Beijing.

“The government wants to show that stability is at the top of its agenda.”

JOBLESS AND BITTER

The biggest threats to China’s social fabric will come from graduating university students, facing a shrinking job market and diminished incomes, and from a tide of migrant laborers who have lost their jobs as export-driven factories have shut.

Factory closures, sackings and difficulties paying social security had already unleashed a surge of protests, the report said. Officials in provinces that have provided tens of millions of low-paid workers for coastal factories have reported a leap in the number returning to their farm homes without work.

State statistical authorities estimated that close to 10 million rural migrant workers had lost their jobs, the magazine said, without specifying when the sackings happened.

Including students who graduated in 2008 and had not found work, there would be more than 7 million university and college graduates hunting for jobs this year, Huang calculated.